Gifts of Appreciated Securities

Donating stocks, bonds and mutual funds directly to Quest can make a bigger impact compared with donating cash or selling your appreciated securities and contributing the after-tax proceeds. You may be able to automatically increase your gift and your tax deduction. Click here for Quest stock delivery information.

• Donor instructs brokers to transfer stock to Quest, Inc.
• Donor who itemizes can claim an income deduction.
• Quest, Inc. sells securities in order to invest in programs and services.

The Tax Cuts and Jobs Act

New Provisions and Giving Strategies for 2020

The Tax Cuts and Jobs Act (The Act) signed into law on December 22, 2017, includes several changes that are relevant to charitable giving. Each provision is effective from January 1, 2018 and sunsets December 31, 2025 unless extended by Congress.

The deduction for cash gifts to charity has increased to 60% of Adjusted Gross Income.

The Act doubles the estate and gift tax exemption to $11.2 million per person and $22.4 million for married couples. Individuals can now give larger amounts to family members and individuals at death without incurring estate tax.

IRA Charitable Rollover

If you are 70½ or older, you can give up to $100,000 from your individual retirement account directly to charity. The contribution counts towards your required minimum distribution (RMD) and isn’t included in your adjusted gross income. This strategy is tied to your adjusted gross income and reduces or eliminates taxes on social security benefits. The transfer must come directly from the IRA custodian to the qualified charity.

You can’t give your RMD from a 401(k) to charity without triggering a tax, but you can donate your 401(k) RMD tax-free if you roll it over into an IRA. See your accountant or tax professional for advice.

Making gifts of highly appreciated assets allows donors to avoid capital gains tax that would be due if the assets were sold, offering tax savings even if the taxpayer uses the standard deduction.

Donors with donor advised funds can direct gifts to Quest, Inc. and other public charities.

An Overview of the 2017 Tax Legislation – Prepared by PricewaterhouseCoopers (PwC) and provided by Morgan Stanley can be found here.

Gifts of Cash, Check or Credit Card

Cash assets from charitable giving provides the most immediate deduction. Donor receives a charitable deduction up to 60% of adjusted gross income, if the donor itemizes. Donor using credit cards may receive redeemable points or rewards.

If you itemize: A $1,000 contribution saves $350 for a person in the 35% tax bracket and $240 for someone in the 24% tax bracket.

Individuals giving to Quest and our mission are giving because they want to make a difference in the lives of individuals with developmental disabilities. They know philanthropy allows Quest to provide quality and innovative services, while reducing their tax liability. Good news for the donor and great news for Quest and the people we serve.

Gifts That Pay You Income

Donors who want to provide for Quest, Inc. in the future and feel that they can’t afford to make a large gift at this time in their life can consider several options. Donors can make their gift today and receive payments throughout their lifetime. These giving techniques give the donor satisfaction of giving while providing Quest, Inc. with a lasting benefit to our programs. Charitable Remainder Annuity Trusts allow donors to make larger gifts than they thought possible.

Charitable Remainder Annuity Trust

• Donor transfer assets to a trustee.
• Donor who itemizes is eligible for an income tax deduction.
• Trustee makes fixed dollar amount payment to the beneficiaries as income.
• When the trust ends, the remainder becomes an asset of Quest in support of its mission.

Charitable Remainder Annuity Unitrust

• Donor transfer assets to a trustee.
• Donor who itemizes is eligible for an income tax deduction.
• Trustee makes payment to the beneficiaries as income which fluctuate with the value of the assets.
• Payments can last a lifetime or up to 20 years.
• When the trust ends the remainder becomes an asset of Quest in support of its mission.

Wills and Living Trusts

Types of Will Structure:

• Outright specific bequest of item or dollars
• Residual bequest
• The residual or remaining balance of the estate is gifted to Quest to support its mission.

Appreciated Assets

Life Insurance

Many individuals own life insurance policies purchased years earlier to protect their family or business partners. If you no longer need the policy for the original purpose, a satisfying use of the policy might be used as a charitable gift to Quest, Inc. You can donate ownership of the policy and you may be able to take a charitable deduction if you itemize.

Collectables

Over a lifetime, individuals may have collected valuable assets such as antiques, paintings, coin and stamp collections, and copyright royalties. When considering donations of collectables, the donor and Quest, Inc. will need to discuss the fair market value, tax implications and feasibility for resale. Before giving a gift of collectable items, please consult with your advisor and Quest, Inc. before making a treasured gift.

Business Interests

An employee stock ownership plan (ESOP) and business ownership interests are excellent ways of supporting Quest, Inc. with a major gift in support of helping people with developmental disabilities achieve their dreams.

IRA Qualified Charitable Distributions

When you become age 70½ and older, you have the ability to make a gift directly from an IRA of up to $100,000 as part of your required minimum distribution, which is generally taxable. When making an IRA contribution, it is important that the custodian coordinates with Quest, Inc. to ensure you receive the necessary tax receipts.

Real Estate (Residential, Commercial, Agricultural)

The tax benefits for gifts of highly appreciated real estate are similar to gifts of securities that have grown in value. A donor will avoid capital gains tax on investment growth. If the donor itemizes, they can claim a charitable deduction for the fair market value. Before giving a gift of real estate, please consult with your advisor and Quest, Inc.

Donor Advisors & Donor-Advised Funds

Many donors utilize an investment team including wealth managers, accountants and estate-planning legal counsel. They will be instrumental in the planned-giving process based upon your investment and philanthropic objectives.
Donor Advised Funds have grown in popularity.

Generally, a donor advised fund is a separately identified fund or account that is maintained and operated by section 501(c)(3) organization, which is called a sponsoring organization. The Central Florida Foundation, Community Foundation of Tampa and other financial institutions are also sponsors of Donor Advised Fund Accounts. Each account is composed of contributions made by individual donors. Once the donor makes the contribution, the organization has legal control over it.

However, the donor, or the donor’s representative, retains advisory privileges with respect to the distribution of funds and the investment of assets in the account.

Donor advised funds are a great financial and philanthropic vehicle for individuals without a family or individual foundation. Donors receive tax benefits, can time valuations of assets and support various philanthropic charities through one account.

Planned Giving Glossary of Terms

Planned Giving / Gift Planning: The planned transfer of an individual’s or a couple’s assets to a charity during their lifetime or upon their death may provide immediate or deferred tax benefits. There are many types of planned gifts which meets the donor’s philanthropic interests and is a financial management instrument.

Outright Gift: A contribution of cash or property in which donor retains no interest and can be used right away by charity.

Will: The most basic instrument used to distribute an asset, also called Last Will and Testament. A will is a legal document that spells out the disposition of a person’s assets after death. It is governed by state law and is the most basic element of an estate plan.

Endowment: A gift that is intended to be kept permanently and invested to generate income for charitable purposes. The endowment houses planned gifts received by the organization.

Bequest: A gift received after death generally received through a donor’s will or other estate-planning document (such as a living trust).

Living Trust: A written agreement to govern the distribution of assets at death. The trust is established by donor for their lifetime and is usually revocable.

Life Insurance: The simplest way to use life insurance to give to charity is to name a charity as beneficiary on a life insurance policy. Designating the charity as beneficiary allows donor to make a larger gift than they could otherwise afford. No immediate tax benefit.

Life insurance (Existing Policy): Donor assigns all rights in the policy to charity. Donor delivers the policy itself to charity and gives up control of the life insurance policy forever. Because transfer of ownership is irrevocable, this provides some tax advantages.

Life insurance (New Policy): Donor applies for a new policy and immediately assigns all rights in the policy to charity. Donor pays all the premiums to the charity. A charitable deduction for premiums may be taken. The IRS treats this transfer as if the charity itself has purchased the policy on donor’s life. Donor is entitled to full tax advantages of the annual gift for the premiums.

Professional Advisors: Estate-planning attorneys, financial planners, trust officers, certified public accountants, stockbrokers and insurance agents who can be invaluable guides in helping donors include charitable giving in their plans.

Retirement Assets: Assets such as a retirement plan, 401(k), 403(b), IRA, Keogh, or other qualified pension plans. Designating the charity as beneficiary allows the donor to make a gift to a charity of their choice upon death that may carry additional tax benefits.

Charitable Gift Annuity: A contract between a donor and a charity where a donor receives a lifetime income from the charity in exchange for a donation of cash or property. The donor receives a partial tax deduction and the charity keeps the gift upon their death.

Contact Quest Philanthropy

To discuss a planned gift, learn more about our programs or schedule a tour in Orlando or Tampa, please contact our Philanthropy department.

Lauren Nelson
Vice President of Philanthropy
Office: (407) 218-4327

Quest is a non-profit organization qualifying under Section 501(c)(3) of the Internal Revenue Code, and your donation will be tax deductible to the fullest extent allowed by law.

A copy of Quest, Inc.’s official registration #CH544 and financial information may be obtained from the Division of Consumer Services by calling toll-free (800-435-7352) within the state. Registration does not imply endorsement, approval or recommendation by the state.